National Economic Outlook - July 2015

Written By:
Ingo Winzer, President

Local Market Monitor

Real estate hasn't done much the recovery so far; the dysfunctional aspects that contributed heavily to the recession are still getting sorted out. But it looks like a more "normal" real estate situation is just around the corner.

The easiest way to see this is to look at new home sales - the statistics aren't contaminated by foreclosures. In normal times, around 800,000 new homes are sold in the US every year. During the recession, that level dropped to 300,000 but now it's up to 500,000. Each new home built directly translates into 4 full-time jobs, so the likely increase to 600,000 new homes next year will create 400,000 new jobs.

The economy in June had 3 million more jobs than a year ago, a 2.1 percent increase. Jobs were up 1.3 percent in manufacturing, 2.0 percent in retail, 3.5 percent in business services, 3.0 percent in healthcare, and 3.3 percent at restaurants. Jobs in finance increased 2 percent, but mainly because of additions at insurance companies. The unemployment rate fell to 5.3 percent